A new report warns that UK’s legislation on tackling the gender pay gap does little to solve the problem at hand but instead simply monitors the pay gap.
Research by the Global Institute for Women’s Leadership at King’s College London and the Fawcett Society warns that gender pay gap reporting in the UK “has no teeth”.
This, the report states, is largely due to the lack of a mandate which would otherwise place responsibility on employers to act on their plans to narrow the gender pay gap present within their organisation.
This comes ahead of the gender pay gap reporting deadline today when employers with over 250 employees must send in figures linked to their gender pay gap.
Although reporting this information is compulsory, adding a supporting narrative and employer action plan are discretionary options.
Ranking the UK against five other countries, the UK’s gender pay reporting was deemed to be the joint lowest alongside Australia.
Though the UK was commended for its high level of transparency regarding accessibility to gender pay gap data, it was criticised for its lack of mandated action plans and failure to follow-up on these action plans.
This was contrasted against other countries such as Spain, South Africa, France and Sweden which all require employers to follow up on their action plans, whether through built in time restrictions or monitoring, making change more likely.
Furthermore, the UK was the only country in the research which permitted employers with under 250 staff to avoid publishing gender pay gap data.
Stakeholders in the UK, interviewed as part of this report, felt that organisations with pay gaps needed to be compelled to produce action plans with clear goals and timelines, spelling out how they intend to improve hiring practices, progression, promotion and policies around family leave and flexible working, in order to address pay disparities between women and men.
This is because, whilst many companies are compliant with handing in data, the pressure linked to making changes is not always enough to drive organisations to action.
As such, some recommendations laid out by the report to improve gender pay reporting include:
- Establishing a legal obligation to publish action plans.
- Lowering the minimum employee threshold.
- Introducing automatic fines for non-submission of reports.
- Increasing the capacity of the GEO and Equalities and Human Rights Commission to provide better guidance and support and conduct more rigorous monitoring and analysis of submitted data.
Ann Cairns, Executive Vice Chair of Mastercard and Global Chair of the 30 per cent Club, said:
There is a saying ‘what gets measured gets done’ but it’s clear that in this case it’s just a start.
Gender pay gap reporting is a good thing. It would be encouraging if more companies did this voluntarily. Because they would be acknowledging it’s a problem, being transparent and then hopefully taking actions to close the gap.
Reporting without owning the problem is unlikely to yield good results. That’s why the UK ranks low on this list.
But, in my view, fining companies to make them comply is a very poor way to achieve good results. There is so much companies can do to close the gender pay gap to make the workplace more equitable, from implementing unified parental policies to ensuring they have balanced slates for interviews and succession plans.
*This research has been documented in the report “Bridging the Gap: An Analysis on Gender Pay Gap reporting in six countries” by the Global Institute for Women’s Leadership at King’s College London and the Fawcett Society.